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Thursday, March 17, 2011

Five-Part Series on Affiliate Marketing: The Agreement

It’s important to have a formal agreement, which is the fourth thing you need to make your affiliate marketing relationships work.

It’s important to understand what your rights and obligations are. Some affiliate marketing relationship agreements are only a few paragraphs long. Others are pages. One is not necessarily better than the other. What is more important is clarity. Do you understand what you can — and cannot do — to promote the relationship? Do you understand how, and when you will get paid? Is there anything prohibited by the arrangement?

For example, some affiliate programs (like domain name registrar 1and1.com) will allow you to use your own affiliate link to purchase products and services, and you’ll get paid on the order — basically, giving you a discount. Others strictly prohibit you from using your own affiliate code. AdSense, for example, will kick you out of the program if they find that you click on the ads that appear on your content, because this artificially inflates the income you receive from the advertising program. It’s important to know this!

Payment is also an area that isn’t often examined too closely by resume writers and career coaches. You might be thrilled to learn you’ve earned a couple of 30% commissions — until you see that the payment is still “pending” in your account. It’s one thing if your payment was just held up a bit while you submitted a tax identification number form to the affiliate network — it’s quite another if the affiliate provider has a $250 payment threshold…and you earn about $25 per month. Do you want to wait almost a year for your payment?

So there’s a balance. You might choose to affiliate with an independent program that pays a healthy commission on a regular basis — OR you can choose to go with an affiliate network that offers multiple affiliate opportunities, but at a smaller commission, because it’s easier for you to hit the payout threshold if you’re promoting multiple products.